Which of the Following Possible Response Variables Is Most Appropriate

question 74

Multiple Choice

Which of the following possible response variables is most appropriate to predict using a regression tree?

• A) political party preference of a registered voter
• B) rate of return on an investment
• C) option(s) a new car buyer will select
• D) which borrower(s) will default on a loan
• E) whether or not a fitness center member will renew their membership

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Definitions:

Material

In financial and accounting contexts, refers to information or an item that could influence the decision-making process of users of financial statements.

Omission

An oversight or failure to include something, often resulting in an incomplete set of information or accounting records.

Misstatement

A false or inaccurate statement or entry, often in financial reporting or documentation.

Historical Cost

The original monetary value of an asset, reflecting its cost at the time of acquisition, without adjustments for inflation.